Stephen Jen: US Fiscal Profligacy Threatens Dollar's Safe-Haven Status

Stephen Jen of Eurizon SLJ Capital stated that Washington's spending spree is jeopardizing the US dollar's status as a globally trusted safe haven. Jen warned that rising fiscal risks could weaken the dollar's privileged position in the bond market. According to Jen, the US administration's ongoing high spending increases the country's debt burden, negatively impacting the dollar's value and reputation. This could shake investor confidence in the dollar and accelerate the search for alternative safe havens. The expert expressed that the dollar's current position is unsustainable and that fiscal indiscipline could undermine the dollar's role as a reserve currency in the long term. In particular, questioning US credibility in the bond market poses a risk to global financial stability. Jen predicts that if this trend continues, the dollar could depreciate and investors may diversify their portfolios. However, he added that this process would be gradual and a sudden collapse is not expected. This is not investment advice.